Canadians suffer from economic downpour

Almost half of Canadians reported that their bank accounts got drained between pay periods, while many others were left in debt. They attributed these factors to an uncertain economy.

Canadian Payroll Association stated that out of surveyed people, forty-eight percent of respondents believed that any delay in their paycheque would put them in problematic situation. Four in ten Canadians said they spent all or more of their take-home pay, while nine out of ten carried debt.

“A significant percentage of working Canadians carry debt, have a gloomy view of their local economy and are fearful of rising interest rates, inflation, and costs of living,” Patrick Culhane, the CPA’s president and CEO said in a statement.

One in ten of the survey’s respondents believed that they would never be debt-free. A quarter of the five thousand people polled also said in an emergency situation they wouldn’t be able to arrange a minimum of $2,000 too.

Respondents cited that the most common type of debt was a mortgage (twenty-six percent), followed by credit-card debt (eighteen percent), car loans (seventeen percent) and a line of credit (sixteen percent).

Ontarians were more pessimistic of their financial situations, with forty-two percent overwhelmed by their level of debt, higher than the national average of thirty-nine percent and the three-year average of thirty-six percent, the sources added.

Canadian economy shrank, according to sources, during the second quarter of this year mainly due to Alberta’s wildfires in May, which stopped their oil production. Other economists were discouraged by the recent decline of the dollar against the U.S. greenback, resulting in the decrease of rebound of non-energy exports.

Experts said that the Bank of Canada was optimistic about improvement of economy in the second half of this year. But most economists feel growth would be slow considering weak global trade terms, low prices of commodities, household debt and with wage growth almost stagnant.

According to experts, overall salary increases in 2017 are expected to be just 2.3 percent. About forty percent of energy sector employers plan to freeze wages. This would put Alberta’s projected salary increase below the national average.

(Reporting by Asha Bajaj/IBNS)